California Recreational Marijuana Framework

In 1913, California became the first state to facilitate the process of what would eventually be all 50 states banning marijuana. From there, the plant once used for everything from food to clothing to medicine was placed on a federal list of schedule 1 controlled substances right alongside heroin. A lot of time has passed since 1913 and in 2018, the Golden State will be selling the once outlawed plant much similarly to how alcohol is sold today–recreationally.

A LOOK INTO THE RECREATIONAL MARIJUANA FRAMEWORK OF CALIFORNIA

In 1996, California began the arduous journey of lifting the ban they helped create on the cannabis plant. Following the vote of yes by California residents on Proposition 215, medical marijuana became legal for the first time since the early 1900’s in California. 20 years later, the state voted in the 2016 election on allowing the banned control substance to be sold to adults 21 and over. With a resounding yes, the state spoke and agreed to lift the century-long ban on recreational marijuana.

Following the monumental vote in 2016, the state of California needed to reassess previous sanctions on marijuana that were placed when they legalized the plant medicinally in 1996. From there, the state needed to give the laws a new coat of paint to meet the demands of selling it recreationally in 2018.

BRINGING CANNABIS INTO THE NEXT GENERATION

Following the 2016 election, the constituents of California voted yes to Proposition 64. As a byline in this legal document, lied the Adult Use of Marijuana Act (AUMA). Some of the regulations set forward in this act contradicted previous laws put in place when California legally recognized marijuana as a medicinal plant back in 1996. On June 27, 2017, the state of California tried to find a way to take the marijuana laws drafted up in 1996 and meld them with the laws being drafted in the present to create a comprehensive marijuana plan for the future.

With this realization, legislatures drafted up what is known as Senate Bill (SB) 94. Under provisions outlined in SB 94, what is now known as the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA) was enacted. With MAUCRSA, many of the provisions implemented under AUMA have been integrated into the new emergency regulations released under MAUCRSA.

Under SB 94, the California Bureau of Cannabis Control (CBCC) was created and charged with implementing MAUCRSA across the state. Californians had to wait on the Bureau, the Department of Health, and the Department of Food & Agriculture to enact rules and regulations related to cannabis. The much-anticipated emergency rules were finally released on November 16, 2017. Now that the emergency rules are going into effect, sales of recreational cannabis in California can begin on time as hoped by January 1, 2018. Sometimes good things are just worth the wat.

HIGHLIGHTS OF CALIFORNIA’S EMERGENCY RECREATIONAL CANNABIS RULES

With the new year rapidly approaching, those wishing to open a recreational cannabusiness must obtain a temporary license under the new emergency regulations. The temporary licensing application system is online. Once you complete the process, temporary licenses are valid for 120 days. Much like when a business first applies for a liquor permit, this time-sensitive sanction allows business owners about a six-month transition period to comply with the new rules. As long as the licensee submits a complete application for an annual license to the state, they can also renew their temporary permits for up to 90 days at a time if need be. All temporary licenses will go into effect on January 1, 2018. From that day forward, the 120 day window begins.

Licenses available under the new regulations include a:

Unfortunately, under MAUCRSA some license requirements are actually quite onerous and burdensome for owners. For example, licenses are not transferable. Those with distribution licenses are not allowed to repackage or relabel any infused cannabis products unless they get an additional manufacturing license, and they also cannot store any non-cannabis goods on their licensed premises.

Thankfully, this is not the case for already-established cannabusinesses. Written into the provisions, there is a priority licensing agreement in the emergency rules. Businesses that can prove they were in good standing within their locality prior to September 1, 2016 will be given priority status.

PROHIBITIONS UNDER THE NEW RECREATIONAL CANNABIS REGULATORY REGIME

Prohibition, there’s that word again. Even though alcohol is mostly legal, there’s still an asterisk next to it in the businessworld. For instance, some states won’t allow sales on Sunday, while others only allow alcohol sales during business hours. These sort of speciality rules also apply to recreational marijuana under California law.

For instance, the regulations on advertising and marketing rules for retail cannabusinesses are very strict under the newly drafted guidelines. In California, the entire audience of any recreational cannabis advertising must be over 21 years of age. Comparatively, in Colorado, advertising and marketing regulations are not as strict and follow the 30/70 rule, under which no more than 30% of the audience can be under 21. California licensees also cannot use the word “candy” in any of their branding, so as not to attract the attention of minors. This is much similar to the regulation placed on cigarette companies in the 90’s and 2000’s for depicting cartoons smoking cigarettes. Here’s looking at you, Joe Camel.

Cannabusiness owners operating out of California also must beef up on their security detail. Both recreational retailers and micro-businesses are required to hire a third-party security firm to guard and patrol their licensed premises. Combined alcohol and cannabis sales are also not permitted. Not surprisingly, when it comes to cannabis deliveries, drones cannot be used to deliver product to consumers.

California cannabis license applicants should also remember they will face regulations and rules at the local-level as well. Cannabusiness owners interested in becoming licensed under the new California rules should be sure to fully read all the new emergency regulations and the applicable local rules before pursuing any type of cannabis license.